Foreign Investment

This Forum is the main messageboard to discuss all things Claret and Blue and beyond
# 1
Spijed
Posts: 7090
Joined: Mon Jan 18, 2016 12:33 pm
Been Liked: 1224 times
Has Liked: 568 times

Re: Foreign Investment

Postby Spijed » Tue Aug 28, 2018 1:50 pm

quoonbeatz wrote:can't force them to think a particular way though spijed.


That's certainly true.

I wanted to get past Olympiakos, if nothing else just to see Burnley in some place where I've never been to. Alas, I feel it''ll be a bit of an 'Eye on the Man U. game' type of performance and sub consciously the players won't be running through brick walls to win the match.

In our lifetimes we are unlikely to ever see us play in Europe again. A real shame, but there you go.

# 2
aggi
Posts: 2606
Joined: Thu Jan 21, 2016 11:31 am
Been Liked: 587 times

Re: Foreign Investment

Postby aggi » Tue Aug 28, 2018 3:23 pm

As I've said a number of times previously, the majority of clubs aren't being financed by foreign investment. It might have got them promoted but most of the clubs are breaking even on the Premier League revenue, not investment from their backers.

Arguably the difference is that if those clubs get relegated they have a potential safety net that we do not and, for that reason, we have been building up a lump of cash that can be used for working capital if we do get relegated, hence our lower spending.

I would suggest that we're near to getting that safety net up to the required level and, if we stay up this season, can start to spend with more freedom.

It may be that the picture is changing with clubs like Fulham and Wolves coming up and splashing the cash (although I wouldn't be surprised if they managed to break even without outside cash this season, they're not spending that much.). Bear in mind that we could have paid our first team squad £100k a week each last season and still broken even, we're a fair way from exhausting what we're earning each season.

# 3
Danieljwaterhouse
Posts: 153
Joined: Fri Jan 22, 2016 8:55 pm
Been Liked: 48 times
Has Liked: 40 times

Re: Foreign Investment

Postby Danieljwaterhouse » Tue Aug 28, 2018 10:24 pm

quoonbeatz wrote:tybfc said the same before the istanbul game, although it was only one director.

i'd be very sceptical that our directors would be telling random fans that they wanted out of europe, even if it was their opinion. you'd hope they'd have the sense to appear positive about it. kilby certainly looked like he was enjoying his bus tour of athens.

no reason to believe or disbelieve ty really.


No way a director told a fan anything

# 4
Devils_Advocate
Posts: 2437
Joined: Sun Oct 30, 2016 2:43 pm
Been Liked: 688 times
Has Liked: 113 times

Re: Foreign Investment

Postby Devils_Advocate » Tue Aug 28, 2018 10:42 pm

aggi wrote:As I've said a number of times previously, the majority of clubs aren't being financed by foreign investment. It might have got them promoted but most of the clubs are breaking even on the Premier League revenue, not investment from their backers.

Arguably the difference is that if those clubs get relegated they have a potential safety net that we do not and, for that reason, we have been building up a lump of cash that can be used for working capital if we do get relegated, hence our lower spending.

I would suggest that we're near to getting that safety net up to the required level and, if we stay up this season, can start to spend with more freedom.

It may be that the picture is changing with clubs like Fulham and Wolves coming up and splashing the cash (although I wouldn't be surprised if they managed to break even without outside cash this season, they're not spending that much.). Bear in mind that we could have paid our first team squad £100k a week each last season and still broken even, we're a fair way from exhausting what we're earning each season.

Do you think there is also a limit to what we are willing to pay not because we want to build up a lump sum but so if we do drop we have a manageable wage bill with the relegation clauses to operationally break even on the parachute payment budget? If thats the case we might never be able to release the shackles as the wage bill will always be a sticking point.

My view is we shouldnt overspend so a relegation would break us but we should spend up to that limit as giving us the best possible chance of staying in this division is a far better strategy (imo) than going down with cash in the bank as if we dont bounce straight back it will get swallowed up very quickly anyhow

# 5
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Tue Aug 28, 2018 10:59 pm

Devils_Advocate wrote:Do you think there is also a limit to what we are willing to pay not because we want to build up a lump sum but so if we do drop we have a manageable wage bill with the relegation clauses to operationally break even on the parachute payment budget? If thats the case we might never be able to release the shackles as the wage bill will always be a sticking point.

My view is we shouldnt overspend so a relegation would break us but we should spend up to that limit as giving us the best possible chance of staying in this division is a far better strategy (imo) than going down with cash in the bank as if we dont bounce straight back it will get swallowed up very quickly anyhow


D_A.......I believe the big problem is that a number of our Directors have been around a long time, old school if you like, and find it very hard (even alien) to adjust to the wage madness of the Premier League today. I was staggered when our Wage bill increased from £39m to £61m to Jun'17 but still we are way way behind the figures that clubs similar in stature to us are willing to pay.

Perhaps we need a fundamental change at the top in order to join the party.

# 6
Devils_Advocate
Posts: 2437
Joined: Sun Oct 30, 2016 2:43 pm
Been Liked: 688 times
Has Liked: 113 times

Re: Foreign Investment

Postby Devils_Advocate » Tue Aug 28, 2018 11:08 pm

Its a tough one and I dont have anywhere near the insight to know the exact numbers. Im not critical of our money men but as someone who isnt wanting the club to go silly it does feel to me we are being a bit cautious and it could come back and bite us on the bum.

Ultimately for me Dyche is still the key factor and whether we spend money or not its when he goes we'll finally drop I think. I would hate to lose Dyche sooner than we need to though because the owners wont back him as much as they sensibly could do

# 7
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Tue Aug 28, 2018 11:20 pm

Devils_Advocate wrote:Its a tough one and I dont have anywhere near the insight to know the exact numbers. Im not critical of our money men but as someone who isnt wanting the club to go silly it does feel to me we are being a bit cautious and it could come back and bite us on the bum.

Ultimately for me Dyche is still the key factor and whether we spend money or not its when he goes we'll finally drop I think. I would hate to lose Dyche sooner than we need to though because the owners wont back him as much as they sensibly could do


Tell me a time in the recent history of the Club when we weren't a 'bit cautious'.

Last year when we needed to go that extra mile we failed to do so. As a result we will report an Operating Net Profit approaching £60m and to me that is unforgivable. BFC isn't a business that is required to make profits in order to pay a dividend to it's shareholders, any surplus funds should be used to strengthen the squad in order to allow Dyche the best opportunity to stay in the big league.
These 2 users liked this post: Devils_Advocate mybloodisclaret

# 8
Wokingclaret
Posts: 534
Joined: Fri Jun 03, 2016 10:18 pm
Been Liked: 79 times
Has Liked: 169 times

Re: Foreign Investment

Postby Wokingclaret » Tue Aug 28, 2018 11:24 pm

Tell me a time in the recent history of the Club when we weren't a 'bit cautious'."

Easy, 2009, Easy under Eddie Howe

# 9
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Tue Aug 28, 2018 11:27 pm

Ha Ha, nice one Woking, but I'm not referring to our style of play on the pitch.

In any case Eddie Howe wasn't around in 2009.

# 10
Wokingclaret
Posts: 534
Joined: Fri Jun 03, 2016 10:18 pm
Been Liked: 79 times
Has Liked: 169 times

Re: Foreign Investment

Postby Wokingclaret » Tue Aug 28, 2018 11:32 pm

No, but in 2009 we over spent and if it wasn't for one of the Directors we would not have made it to Wembley.


After Howe we had to sell,
This user liked this post: Chester Perry

# 11
aggi
Posts: 2606
Joined: Thu Jan 21, 2016 11:31 am
Been Liked: 587 times

Re: Foreign Investment

Postby aggi » Tue Aug 28, 2018 11:33 pm

Devils_Advocate wrote:Do you think there is also a limit to what we are willing to pay not because we want to build up a lump sum but so if we do drop we have a manageable wage bill with the relegation clauses to operationally break even on the parachute payment budget? If thats the case we might never be able to release the shackles as the wage bill will always be a sticking point.

My view is we shouldnt overspend so a relegation would break us but we should spend up to that limit as giving us the best possible chance of staying in this division is a far better strategy (imo) than going down with cash in the bank as if we dont bounce straight back it will get swallowed up very quickly anyhow


I'd say the two are linked. The more we have in the bank the more manageable the wage bill is in the event of relegation. I don't think there's any expectation that we'd break even in the first season (or second) after relegation.

I suspect there is a nervousness about it. It's well publicised that our wages are heavily performance based, the better to manage if we do go down, and I imagine that even though the on target earnings may be the same at Burnley as another club it's obviously preferable to go where the basic is higher.

I don't think relegation clauses in themselves are that big a difficulty. They're pretty standard nowadays and the likelihood is that the highest earners will be gone elsewhere if relegation happens.

# 12
Wokingclaret
Posts: 534
Joined: Fri Jun 03, 2016 10:18 pm
Been Liked: 79 times
Has Liked: 169 times

Re: Foreign Investment

Postby Wokingclaret » Tue Aug 28, 2018 11:33 pm

Charlie Austin

# 13
Devils_Advocate
Posts: 2437
Joined: Sun Oct 30, 2016 2:43 pm
Been Liked: 688 times
Has Liked: 113 times

Re: Foreign Investment

Postby Devils_Advocate » Tue Aug 28, 2018 11:36 pm

Wokingclaret wrote:No, but in 2009 we over spent and if it wasn't for one of the Directors we would not have made it to Wembley.


After Howe we had to sell,


Eddie Howe had to offload players to value of £12m and spend around £5m rebuilding team with Trippier, Mee, Shackell, Stanislas, Vokes, Austin and Ings

Howe was left to mop up after the Laws fiasco and left the club in a lot better state than he found it. If we had to sell after Howe it was still because of or spending under Coyle and Laws and not Howe
This user liked this post: tim_noone

# 14
Wokingclaret
Posts: 534
Joined: Fri Jun 03, 2016 10:18 pm
Been Liked: 79 times
Has Liked: 169 times

Re: Foreign Investment

Postby Wokingclaret » Tue Aug 28, 2018 11:40 pm

Don't disagree there was many bad buys
This user liked this post: Devils_Advocate

# 15
Paul Waine
Posts: 3938
Joined: Fri Jan 22, 2016 2:28 pm
Been Liked: 969 times
Has Liked: 1161 times

Re: Foreign Investment

Postby Paul Waine » Tue Aug 28, 2018 11:42 pm

Royboyclaret wrote:Tell me a time in the recent history of the Club when we weren't a 'bit cautious'.

Last year when we needed to go that extra mile we failed to do so. As a result we will report an Operating Net Profit approaching £60m and to me that is unforgivable. BFC isn't a business that is required to make profits in order to pay a dividend to it's shareholders, any surplus funds should be used to strengthen the squad in order to allow Dyche the best opportunity to stay in the big league.


Hi Roy, are you sure about that figure? Seems on the high side for me. My "guestimate" is that wages (and related) employment costs in 2017/18 season will be of the order of £80 million. And, this figure will be rising again this season as the new contracts, plus new signings are expensed for a full year.

I feel that the board have been prepared to fund all the transfers, provided the deals were the right ones. Of course, there are many players who have wanted more than Burnley would pay, both transfer fees and wages (and/or maybe relegation clauses), and maybe some of the potential signinfs have preffered a more certain high fixed wage than a Burnley wage plus very good bonuses for "hitting the heights."

The difference between our board and that of other clubs is (1) more controlled budgeting - because they haven't got the wealth to bail the club out if things go wrong, (2) they know we are a club with a limited fan base, so tighter margins than the clubs based in areas with larger populations, (3) the board don't want to be the ones to make the mistakes that lets the club down and triggers a downwards spiral, so no pushing too close to the edge.


Anyway, just my views.

UTC

# 16
Chester Perry
Posts: 4034
Joined: Thu Jun 02, 2016 11:06 am
Been Liked: 597 times
Has Liked: 222 times

Re: Foreign Investment

Postby Chester Perry » Tue Aug 28, 2018 11:44 pm

Devils_Advocate wrote:
Howe ….. left the club in a lot better state than he found it.


maybe the first team squad - but what he did to our youth set-up is taking us years to repair

- I find it highly amusing that he has recently started talking of build a legacy at Bournemouth by developing a new training facility and in the future developing the ground - he sounds a lot like Sean Dyche 3 years ago on this subject

# 17
Devils_Advocate
Posts: 2437
Joined: Sun Oct 30, 2016 2:43 pm
Been Liked: 688 times
Has Liked: 113 times

Re: Foreign Investment

Postby Devils_Advocate » Tue Aug 28, 2018 11:51 pm

Chester Perry wrote:maybe the first team squad - but what he did to our youth set-up is taking us years to repair

- I find it highly amusing that he has recently started talking of build a legacy at Bournemouth by developing a new training facility and in the future developing the ground - he sounds a lot like Sean Dyche 3 years ago on this subject

He was only here 18 months and the people he hired were continued to be employed for years so dont get too wrapped up in believing the picture our anti Howe site editor likes to paint.

Anyhow the Howe thing has been done to death and the point on this thread was that our board were not cautious throughout his reign insinuating he was allowed to spend money. I was just proving that was not the case

# 18
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Tue Aug 28, 2018 11:51 pm

Paul Waine wrote:Hi Roy, are you sure about that figure? Seems on the high side for me. My "guestimate" is that wages (and related) employment costs in 2017/18 season will be of the order of £80 million. And, this figure will be rising again this season as the new contracts, plus new signings are expensed for a full year.

I feel that the board have been prepared to fund all the transfers, provided the deals were the right ones. Of course, there are many players who have wanted more than Burnley would pay, both transfer fees and wages (and/or maybe relegation clauses), and maybe some of the potential signinfs have preffered a more certain high fixed wage than a Burnley wage plus very good bonuses for "hitting the heights."

The difference between our board and that of other clubs is (1) more controlled budgeting - because they haven't got the wealth to bail the club out if things go wrong, (2) they know we are a club with a limited fan base, so tighter margins than the clubs based in areas with larger populations, (3) the board don't want to be the ones to make the mistakes that lets the club down and triggers a downwards spiral, so no pushing too close to the edge.

£70m is the figure I included in the calculation, an increase of £9m from the previous financial year. PL Profit and Sustainability rules would not allow us to go beyond that total. Turnover I assumed at £140m including the £119m merit payments for 7th place.

Then after standard overheads and depreciation plus the profit on sale of Keane and Gray a Net Profit of £58m/£60m is highly realistic.


Anyway, just my views.

UTC

# 19
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Tue Aug 28, 2018 11:59 pm

Paul....for some reason my response appears to be within your quote.
This user liked this post: Paul Waine

# 20
tim_noone
Posts: 7837
Joined: Wed Mar 29, 2017 8:12 pm
Been Liked: 1932 times
Has Liked: 7722 times

Re: Foreign Investment

Postby tim_noone » Wed Aug 29, 2018 12:05 am

Chester Perry wrote:maybe the first team squad - but what he did to our youth set-up is taking us years to repair

- I find it highly amusing that he has recently started talking of build a legacy at Bournemouth by developing a new training facility and in the future developing the ground - he sounds a lot like Sean Dyche 3 years ago on this subject

We've never had a youth team set up in years...

# 21
KRBFC
Posts: 9258
Joined: Thu Jan 21, 2016 10:18 am
Been Liked: 1619 times
Has Liked: 677 times

Re: Foreign Investment

Postby KRBFC » Wed Aug 29, 2018 12:16 am

Erasmus wrote:The question then is would you welcome an outside donor? Would you like it if the persons who bought Manchester City, Hull, Fulham, Bournemouth, Derby, Leicester, Wolves etc had come to Burnley instead and enabled us to be secure in the Premier League?

It's certainly very tempting but overall I wouldn't want it. I like Burnley as we are, a small club relying on our own resources and cocking a snook at the big spenders. I know that will probably mean relegation sooner rather than later, but, as Jesus said, "For what shall it profit a club, if it shall gain the whole world but lose its own soul." I can quite understand why supporters will disagree with this, and I know I am quite an old man and perhaps somewhat behind the times, but that is what I feel. I want to like Burnley as well as supporting Burnley.

You would have preferred us to be skint and relegated over having owners like Man City and competing for all trophies? :lol:

# 22
JohnMac
Posts: 3765
Joined: Sun Jan 17, 2016 6:11 pm
Been Liked: 1301 times
Has Liked: 1988 times
Location: Padiham

Re: Foreign Investment

Postby JohnMac » Wed Aug 29, 2018 7:49 am

lrac wrote:Corner shop mentality.thats Burnley FC .waste 5 million on wells but won't stump up 1 million extra on jay .


I didn't noticed any other club clamouring to prise Jay Rod away from West Brom. That in itself should indicate that there was probably too much sentiment involved.

Would I like to have seen him back, yes. Should we be paying way over the real value, no.

# 23
Lancasterclaret
Posts: 10027
Joined: Thu Jan 21, 2016 2:09 pm
Been Liked: 3460 times
Has Liked: 1760 times
Location: Riding the galactic winds in my X-wing

Re: Foreign Investment

Postby Lancasterclaret » Wed Aug 29, 2018 8:04 am

but what he did to our youth set-up is taking us years to repair


Not denying that, but lets not pretend our youth system was a beacon for bringing players through to the first team was it?

It would be a lot more honest if people realised that we'd been running it on an absolute shoestring for as long as I can remember, because that is all we could afford to do.

Whats been done now is only possible because we can put the money in to run it properly.

# 24
aggi
Posts: 2606
Joined: Thu Jan 21, 2016 11:31 am
Been Liked: 587 times

Re: Foreign Investment

Postby aggi » Wed Aug 29, 2018 10:44 am

Royboyclaret wrote:£70m is the figure I included in the calculation, an increase of £9m from the previous financial year. PL Profit and Sustainability rules would not allow us to go beyond that total. Turnover I assumed at £140m including the £119m merit payments for 7th place.

Then after standard overheads and depreciation plus the profit on sale of Keane and Gray a Net Profit of £58m/£60m is highly realistic.


I think you're probably underestimating overheads and, in particular, depreciation.

T/o - £140m
Wages - £70m
Dep'n - £30m
Other overheads - £15m
Asset disposal - £25m

Gives £50m. So actually not that different now I've looked at the numbers (and my asset disposal figure might be a bit low). Should leave the club with about £75m in Net Assets. A lower figure this season (lower revenue due to league placing, higher wages) would probably give net assets of ~ £100m at the end of the season which looks like a nice round number for that buffer.

# 25
aggi
Posts: 2606
Joined: Thu Jan 21, 2016 11:31 am
Been Liked: 587 times

Re: Foreign Investment

Postby aggi » Wed Aug 29, 2018 10:52 am

Chester Perry wrote:maybe the first team squad - but what he did to our youth set-up is taking us years to repair

- I find it highly amusing that he has recently started talking of build a legacy at Bournemouth by developing a new training facility and in the future developing the ground - he sounds a lot like Sean Dyche 3 years ago on this subject


Possibly (although it is a bit strange that the club kept these destructive staff way beyond Howe's tenure) but the profit we made on players like Ings, Austin and Trippier probably cancelled out what that cost us.

# 26
Royboyclaret
Posts: 1283
Joined: Sat May 21, 2016 12:57 pm
Been Liked: 475 times
Has Liked: 137 times

Re: Foreign Investment

Postby Royboyclaret » Wed Aug 29, 2018 11:21 am

aggi wrote:I think you're probably underestimating overheads and, in particular, depreciation.

T/o - £140m
Wages - £70m
Dep'n - £30m
Other overheads - £15m
Asset disposal - £25m

Gives £50m. So actually not that different now I've looked at the numbers (and my asset disposal figure might be a bit low). Should leave the club with about £75m in Net Assets. A lower figure this season (lower revenue due to league placing, higher wages) would probably give net assets of ~ £100m at the end of the season which looks like a nice round number for that buffer.


Not a million miles from mine. First two figures I had exactly the same, Income including the £119m merit payment and Wages no higher than £70m in order to comply with PL Profit & Sustainability rules.

Then depreciation at £28m (a £6m increase from the previous year), Overheads at £13m (increase of £2m) and finally profit on sale of Keane & Gray at £30m.

So.......

Turnover.......£140m
Wages...........£70m
Amortisation...........£28m
Overheads..............£13m
Profit on Sale of Assets........£30m

Net Profit.........£59m.

# 27
9thMay1987
Posts: 198
Joined: Thu Jan 21, 2016 10:18 am
Been Liked: 55 times

Re: Foreign Investment

Postby 9thMay1987 » Wed Aug 29, 2018 11:34 am

From a financial viewpoint last season must have reached a profit peak.

7th pace, commercials,transfers and match income surely puts total turnover to over £170m with net profit £50-60m.

At 3.5 times earnings the club will be worth approaching £180m.

Any major shareholder must be looking at that figure and their bank account and wondering "right offer, right circumstances"

# 28
Pstotto
Posts: 3360
Joined: Fri Nov 18, 2016 12:11 pm
Been Liked: 546 times
Has Liked: 486 times

Re: Foreign Investment

Postby Pstotto » Wed Aug 29, 2018 7:45 pm

I don't know if anybody is watching the history of the world on BBC4, written by Andrew Marr, but the Dutch tulip craze and it' crash and the hysteria surrounding it, is very similar to the 'market' for players nowadays.

Let's hope Joe hart is not the tulip that caused the crash, on Burnley's tab and not Manchester City's.

# 29
Spijed
Posts: 7090
Joined: Mon Jan 18, 2016 12:33 pm
Been Liked: 1224 times
Has Liked: 568 times

Re: Foreign Investment

Postby Spijed » Wed Aug 29, 2018 7:51 pm

Daft as it may seem, had we spent far more money we would probably have never finished 7th last season, thus reaching a ceiling for us.

The same with Leicester city. Had they set out to try and win the league at the start of the season they would never have done so.

Sometimes you can only achieve success when it's least expected.
These 2 users liked this post: GodIsADeeJay81 tiger76

# 30
tiger76
Posts: 2230
Joined: Sat Jun 24, 2017 9:43 pm
Been Liked: 230 times
Has Liked: 930 times
Location: Glasgow

Re: Foreign Investment

Postby tiger76 » Thu Aug 30, 2018 12:38 am

Spijed wrote:Daft as it may seem, had we spent far more money we would probably have never finished 7th last season, thus reaching a ceiling for us.

The same with Leicester city. Had they set out to try and win the league at the start of the season they would never have done so.

Sometimes you can only achieve success when it's least expected.


There was no expectations on ourselves or Leicester,so the players weren't playing under pressure,both would have settled for mid-table finishes,but started the seasons strongly and momentum propelled that success,also it helped that other teams under-performed,thus allowing us and Leicester to take advantage,also by and large Leicester hit lucky with injuries,all their main players in their title campaign avoided lengthy absences loss of form etc.

When our injury crisis hit in the new year we had enough of a buffer one between 7th and the chasing pack,fortunately for us during the winless run neither Leicester or Everton could put consistent results together either,therefore allowing us to remain in 7th despite hardly picking up points for about 2 months,once our injuries eased we got the crucial victories over both,and these 2 results virtually secured European football.

# 31
MRG
Posts: 662
Joined: Thu Jan 21, 2016 10:13 am
Been Liked: 152 times
Has Liked: 92 times

Re: Foreign Investment

Postby MRG » Sun Sep 16, 2018 9:03 pm

It could be worse, we could have the worry that our owners are going to stop putting money in, then we could end up being relegated!!


Return to “The Bee Hole End”

Who is online

Users browsing this forum: Baidu [Spider], BOYSIE31, BurnleyPaul, expoultryboy, FactualFrank, Lancasterclaret, Majestic-12 [Bot], Mala591, nil_desperandum, NottsClaret, NRC, RingoMcCartney and 94 guests